New reports suggested that private equity house Cinven had dropped plans to form a rival team to bid for the FTSE-100 Index company.

Private equity houses CVC , KKR and Blackstone declared their interest in a potential bid for J Sainsbury to the Stock Exchange two weeks ago, in a deal that could value the firm at é11bn including debt.

Cinven had held initial discussions with private equity firm Texas Pacific over a rival bid for the company, but reports said that Cinven had dropped the idea, after Texas Pacific instead decided to join forces with CVC, KKR and Blackstone.

The move left Cinven without a partner for the bid - despite reported interest from Bain Capital - and Cinven is also said to have been put off by the high price of J Sainsbury's shares, which are currently trading above 500p.

Cinven was this week linked with a potential é10bn bid for Wolseley , the world's largest heating and plumbing distributor.

The company was said to have been looking at a possible approach for the Reading firm, but sources close to the situation said Cinven had considered and rejected the idea, after being approached by an investment bank.

Wolseley's share price soared on the news, but receded as speculation over the deal died down.

In early trading, shares in Sainsbury's dipped 3p, or 0.6 per cent, to 505.75p.